NVIDIA (NASDAQ:NVDA) Shares Down 3.6% - Should You Sell?

Key Points

• NVIDIA shares fell 3.6% on Wednesday, trading as low as $214.51 and closing well below the prior day’s $222.82, even as volume came in slightly below average.
• Despite the pullback, Wall Street remains broadly bullish: analysts recently reiterated or raised price targets, and MarketBeat’s compiled consensus still shows a “Buy” rating with a $305.38 target.
• The company continues to support its long-term story with strong fundamentals and shareholder returns, posting better-than-expected quarterly results, announcing an increased dividend, and authorizing an $80 billion share buyback.

NVIDIA Corporation (NASDAQ:NVDA - Get Free Report) fell 3.6% during trading on Wednesday . The stock traded as low as $214.51 and last traded at $214.75. 154,614,258 shares traded hands during mid-day trading, a decline of 10% from the average session volume of 172,189,063 shares. The stock had previously closed at $222.82.

Trending Headlines about NVIDIA

Here are the key news stories impacting NVIDIA this week:

• Positive Sentiment: NVIDIA’s AI strategy continues to generate new growth narratives, including the launch of the RTX Spark AI PC superchip and broader expansion into AI PCs, robotics, and edge AI. TechCrunch article
• Positive Sentiment: Wall Street remains upbeat, with Needham reaffirming a Buy rating and a $270 target, while Tigress raised its target to $425, reinforcing confidence in NVIDIA’s AI leadership. Benzinga coverage
• Positive Sentiment: NVIDIA’s partner ecosystem keeps expanding, including new collaborations with Akamai, Lightmatter, Ayar Labs, Netris, Aptiv, and Navitas, which highlights broad demand for its AI infrastructure stack. Lightmatter partnership announcement
• Positive Sentiment: CEO Jensen Huang’s comments that AI is not destroying jobs but instead driving a hiring surge, plus his endorsement of other AI suppliers such as Marvell, keep NVIDIA at the center of the AI investment theme. Reuters article
• Neutral Sentiment: NVIDIA also declared a small quarterly dividend, which is positive for income investors but not likely a major near-term stock driver. Dividend article
• Negative Sentiment: Some articles point to a rotation out of NVIDIA and into other AI hardware beneficiaries, suggesting investors are taking profits after the stock’s powerful AI-driven rally. Invezz article
• Negative Sentiment: There is also some overhang from headlines about congressional and insider selling, which may add to cautious sentiment even if it does not change the long-term AI story. Congress trade disclosure

Wall Street Analyst Weigh In

Several research firms recently commented on NVDA. Fundamental Research set a $218.00 price target on shares of NVIDIA in a report on Thursday, February 26th. Rothschild & Co Redburn raised their price target on shares of NVIDIA from $280.00 to $300.00 and gave the company a "buy" rating in a report on Tuesday, May 26th. William Blair restated an "outperform" rating on shares of NVIDIA in a report on Tuesday. Citigroup began coverage on shares of NVIDIA in a report on Wednesday, April 15th. They issued a "buy" rating on the stock. Finally, Sanford C. Bernstein restated an "outperform" rating on shares of NVIDIA in a report on Thursday, May 21st. Three equities research analysts have rated the stock with a Strong Buy rating, forty-seven have issued a Buy rating and three have issued a Hold rating to the company. Based on data from MarketBeat.com, the stock has a consensus rating of "Buy" and a consensus target price of $305.38.

NVIDIA Price Performance

The company has a debt-to-equity ratio of 0.04, a current ratio of 3.44 and a quick ratio of 2.85. The firm has a market cap of $5.20 trillion, a price-to-earnings ratio of 32.89, a P/E/G ratio of 0.54 and a beta of 2.22. The business's 50-day moving average price is $200.19 and its two-hundred day moving average price is $189.85.

NVIDIA (NASDAQ:NVDA - Get Free Report) last released its quarterly earnings results on Wednesday, May 20th. The computer hardware maker reported $1.87 earnings per share for the quarter, topping analysts' consensus estimates of $1.76 by $0.11. NVIDIA had a net margin of 62.97% and a return on equity of 96.94%. The business had revenue of $81.62 billion during the quarter, compared to the consensus estimate of $78.42 billion. During the same quarter last year, the company earned $0.81 earnings per share. The business's quarterly revenue was up 85.2% compared to the same quarter last year. On average, research analysts forecast that NVIDIA Corporation will post 8.04 EPS for the current fiscal year.

NVIDIA Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Friday, June 26th. Investors of record on Thursday, June 4th will be paid a dividend of $0.25 per share. This represents a $1.00 annualized dividend and a yield of 0.5%. This is a boost from NVIDIA's previous quarterly dividend of $0.01. The ex-dividend date is Thursday, June 4th. NVIDIA's dividend payout ratio (DPR) is 0.61%.

NVIDIA declared that its Board of Directors has initiated a stock buyback program on Wednesday, May 20th that permits the company to buyback $80.00 billion in outstanding shares. This buyback authorization permits the computer hardware maker to purchase up to 1.5% of its stock through open market purchases. Stock buyback programs are typically a sign that the company's board of directors believes its stock is undervalued.

Insider Activity

In related news, Director John Dabiri sold 3,004 shares of the firm's stock in a transaction on Friday, March 13th. The stock was sold at an average price of $184.90, for a total transaction of $555,439.60. Following the transaction, the director directly owned 14,788 shares in the company, valued at $2,734,301.20. This trade represents a 16.88% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, CFO Colette Kress sold 42,650 shares of the firm's stock in a transaction on Friday, March 20th. The stock was sold at an average price of $174.89, for a total value of $7,459,058.50. Following the transaction, the chief financial officer owned 881,387 shares in the company, valued at $154,145,772.43. This trade represents a 4.62% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold a total of 906,961 shares of company stock valued at $162,936,268 over the last three months. 3.94% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On NVIDIA

A number of hedge funds have recently added to or reduced their stakes in NVDA. State Street Corp raised its stake in shares of NVIDIA by 1.2% during the fourth quarter. State Street Corp now owns 991,480,489 shares of the computer hardware maker's stock valued at $184,911,111,000 after purchasing an additional 11,451,386 shares in the last quarter. Geode Capital Management LLC raised its position in NVIDIA by 0.6% in the fourth quarter. Geode Capital Management LLC now owns 588,803,093 shares of the computer hardware maker's stock worth $109,446,217,000 after acquiring an additional 3,383,441 shares in the last quarter. Norges Bank acquired a new stake in NVIDIA during the 4th quarter worth about $62,244,133,000. Bank of America Corp DE raised its holdings in NVIDIA by 2.1% during the 1st quarter. Bank of America Corp DE now owns 191,200,989 shares of the computer hardware maker's stock worth $33,345,453,000 after buying an additional 4,019,505 shares during the period. Finally, Legal & General Group Plc raised its holdings in NVIDIA by 1.5% during the 3rd quarter. Legal & General Group Plc now owns 181,203,035 shares of the computer hardware maker's stock worth $33,808,862,000 after buying an additional 2,609,560 shares during the period. 65.27% of the stock is currently owned by institutional investors.

NVIDIA Company Profile

NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.

The company's product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.